Competition Bureau completes investigation into allegations of anti-competitive behavior in Canadian agriculture

GATINEAU, QC, March 15, 2022 /CNW/ – Today, the Competition Bureau announced the closure of an investigation into allegations of anti-competitive behavior related to the supply of agricultural inputs (such as seeds, fertilizers and crop protection products) in the Western Canada.

The Bureau investigated allegations that a number of manufacturers and wholesalers disadvantaged, restricted or blocked the supply of agricultural inputs to Farmers Business Network Canada Inc. (FBN).

The investigation focused on determining:

  • whether an agreement or arrangement against FBN existed between any of the targets of the investigation;

  • whether any of the targets abused a dominant position by acting with the negative intent of foreclosing FBN from the market; and

  • whether any of the alleged conduct had or is likely to have materially prevented or lessened competition as a result.

Following a careful review of the evidence, the Bureau has determined that the evidence does not sufficiently demonstrate that there is an agreement between competitors with respect to FBN.

Nevertheless, the evidence suggests that some market participants were communicating with the aim of influencing suppliers regarding FBN. The Bureau views these communications – which took place in a highly concentrated sector – as a significant concern. Companies should be aware that similar communications could create agreements that violate the civil or criminal provisions of the Conspiracy Act. competition law according to their terms.

The Bureau has also focused on the conduct of targets that it believes are most likely to hold dominant market positions under the Act. At present, the evidence does not clearly demonstrate that their conduct resulted in a substantial lessening or prevention of competition – a condition required for conduct to constitute abuse of dominance.

After carefully reviewing all of the evidence, the Bureau does not intend to pursue its investigation. A stand a summary of the Bureau’s findings and the reasons for terminating this investigation is available on its website.

The Bureau will continue to closely monitor the crop input industry for any anti-competitive behavior that is intended to restrict new entrants and has the potential to materially lessen or prevent competition. If new evidence comes to light, the Bureau will take action.

If you are aware of or are the subject of anti-competitive behavior in the agricultural sector, do not hesitate to bring them concerns for the attention of the Office.

Fast facts

  • Agriculture is an essential part of the Canadian economy. Protecting competition and innovation remains as important in this industry as in emerging sectors – especially digital innovation which can pose disruptive competitive threats to established incumbents.

  • The Bureau has opened a formal investigation into the allegations of October 2019. On February 11, 2020office obtained court orders requiring targets and their affiliates to produce records and information relevant to its investigation.

  • FBN, which entered Canada in November 2017is the wholly owned Canadian subsidiary of Farmers Business Network Inc., a United States company founded in 2014. It operates a digital agricultural platform that provides farmers with access to a variety of data-related services.

  • An agreement or arrangement between competitors may be prohibited under the civil provisions of the competition law where it exists or is proposed between persons, two or more of whom are competitors, so that competition has been or is likely to be substantially prevented or lessened in a market.

  • Abuse of a dominant position occurs when a dominant firm (or group of firms) in a market engages in a practice of anti-competitive acts, with the result that competition has been or is likely to be prevented or lessened. substantially.

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The Competition Bureau is an independent law enforcement agency that protects and promotes competition for the benefit of Canadian consumers and businesses. Competition drives lower prices and innovation while fueling economic growth.

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Lana T. Arthur